Advanced Search
MyIDEAS: Login to save this article or follow this journal

Characteristics of Property-Liability Insurance Acquisition Targets

Contents:

Author Info

  • Kathleen A. McCullough
  • Robert E. Hoyt
Registered author(s):

    Abstract

    This study analyzes the impact of diversification and focus strategies on firms targeted for acquisitions. Based on a sample of acquisitions of property-liability insurers from 1993 to 1997, the study centers on two major questions: (1) whether the diversification or focus decision of the acquirer has an impact on the motivations underlying the selection of a target firm with specific operational and capitalization traits, and (2) whether the target firms are systematically altered on the basis of the diversification or focus aspect of the acquisition. The study finds support for the hypothesis that acquirers select firms with the financial and operational characteristics to meet the diversification or focus needs of the acquirer. The study does not find support for the hypothesis that acquirers systematically alter the capitalization or operational characteristics of a target firm on the basis of the diversification or focus aspect of the acquisition. By controlling for potential self-selection bias and by implementing a definition of diversification and focus that controls for relatedness of the lines of business of the acquirers and targets, the paper is able to extend prior literature in the area. Additionally, the ability to track the financial and operational changes of the target firm following the acquisition allows for a more detailed test of the hypotheses than is possible in multi-industry samples.

    Download Info

    If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
    File URL: http://www.insuranceissues.org/PDFs/281MH.pdf
    Download Restriction: no

    Bibliographic Info

    Article provided by Western Risk and Insurance Association in its journal Journal of Insurance Issues.

    Volume (Year): 28 (2005)
    Issue (Month): 1 ()
    Pages: 61-87

    as in new window
    Handle: RePEc:wri:journl:v:28:y:2005:i:1:p:61-87

    Contact details of provider:

    Related research

    Keywords:

    References

    No references listed on IDEAS
    You can help add them by filling out this form.

    Citations

    Lists

    This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

    Statistics

    Access and download statistics

    Corrections

    When requesting a correction, please mention this item's handle: RePEc:wri:journl:v:28:y:2005:i:1:p:61-87. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (James Barrese).

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If references are entirely missing, you can add them using this form.

    If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.